Vicarious Surgical Completes Beta 2 System Design

Vicarious Surgical (NYSE: RBOT) continues to make progress in developing its Beta 2 robotic surgery platform, although supply chain disruption poses risks to the company’s schedule.

That seemed to be the big message from the Waltham, Mass.-based surgical robotics company’s second quarter earnings report last night.

Vicarious Surgical’s technology uses proprietary human-like surgical robots combined with 3D visualization to transport surgeons inside the patient to perform minimally invasive surgery. CEO Adam Sachs noted on the company’s earnings call that updates to the previous Beta 1 system focused on ergonomic changes for surgeon comfort – and improved visualization capabilities, sensing and 3D motion. The idea is to allow the surgeon to move freely around the abdominal cavity with the system, he said.

“With significant and very positive feedback on the initial Beta 2 ergonomic prototypes, we have completed the Beta 2 design and are beginning the build integration phase,” Sachs said on the call, transcribed by Seeking Alpha. “This is our next step towards bringing our robotic platform to market and demonstrating its capabilities through a potential in-hospital cadaveric hernia procedure, on which we plan to share more details later this year.”

A month ago, Vicarious Surgical signed collaborative Center of Excellence agreements with Nashville, TN-based HCA Healthcare and its 182 hospitals in 20 US states and the UK, as well as University Hospitals Ventures, the innovation and commercialization arm of University Hospitals (UH) in Northern Ohio.

Sachs said the agreements go far beyond simply training surgeons post-marketing; they represent collaboration throughout the development, clinical, verification, validation and launch phases of Vicarious Surgical’s robotic system.

Despite the progress the company has made, Sachs acknowledged that Vicarious Surgical has experienced limited supply of semiconductors and shortages of chips and other hardware in recent months. “If these challenges persist, they may pose a risk to our schedule.”

He added: “We continue to evaluate the details of our supply chain to look for opportunities to create internal redundancies and multi-source key components and improve our product designs to address the limited risks of the supply chain.”

For the quarter ended June 30, 2022, Vicarious Surgical reported an adjusted net loss of $19.1 million, or 16¢ per share. That was two cents behind The Street’s predicted 14¢ loss. The company’s cash burn rate for the second quarter was $15.7 million, with full year cash burn expected at $65-75 million. The goal is to have approximately $100 million in cash and cash equivalents by the end of the year.

BTIG analyst Ryan Zimmerman retained his buy rating on Vicarious Surgical stock, even though he called supply chain challenges an unnecessary distraction: “We await the next clinical steps of RBOTs , which include a potential demonstration of the system later this year at one of their Centers of Excellence.

Investors responded by sending RBOT shares down more than 8% to $4.06 apiece in after-hours trading. The next morning (August 9), however, shares were up 2.1% at $4.53.

Christine E. Phillips